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County more pessimistic than state on property values

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by:
Rachel Brown Hackney
Managing Editor

Sarasota County’s budget officials are continuing their trend in being more conservative than state budget-watchers when it comes to property tax values.

During a budget workshop Sept. 6, Deputy County Administrator Dave Bullock presented a chart to the County Commission showing state projections compared to that of the county for fiscal years 2013 through 2017. As of Aug. 11, he said, state officials estimated the county would see taxable property values rise 2.7% for fiscal year 2013, while the county estimated the value would drop 4%.

“We are more pessimistic than the state,” Bullock said.

Moody’s, the internationally known credit rating service, is even more pessimistic than county officials, Bullock told the commission. Its analysts predict county taxable property values will decline by 6% in fiscal year 2013, he said.

At least state budget officials had dropped their projections over the past year, Bullock added. In August 2010, the state was estimating taxable property values in the county would rise 5.8% by fiscal year 2013.

Referring to state officials, Bullock added, “In fiscal year 2011, they were pretty good” with their projections; “in fiscal year 2012 … not so good.”

“All we can hope is maybe it’s minus 2% or minus 3% instead of minus 4%,” County Commissioner Joe Barbetta said of the fiscal year 2013 projection.

Bullock also said the Moody’s representative with whom he spoke “was really discouraging … and I’ve seen the model (Moody’s uses); it’s a comprehensive, very sophisticated model.”

Commission Chairwoman Nora Patterson said the question never would be whether the county would be able to pay its bills, because county officials always would make certain they did not default on payments.

The commission has tapped its reserve funds to plug budget holes the past two fiscal years. For fiscal year 2012, county budget Interim Chief Financial Planning Officer Steve Botelho said $33.1 million would be coming from reserves.

Bullock also noted expected increases by fiscal year 2013.

“We are starting to show a 3% annual increase in expenses — that’s all expenses, fuel and electricity and the thousands of goods and services (for which the county contracts),” he said. “We know we’re going to have to deal with salaries (too).”

Continuing with projections, Bullock said the county is not looking at a shortfall in meeting its projected budget, without an operating fund millage rate increase, until fiscal year 2015. Then, he said, the shortfall has been projected at $24.9 million. He called the number “our best conservative estimate.”

By fiscal year 2015, he said, the county will have no reserves remaining except its emergency hurricane fund.

“To state the obvious, 2015 is the place where we don’t have an answer right now,” Bullock said.

In light of current discussions about whether governments create jobs, Sarasota County Deputy Administrator Dave Bullock last week showed the county commissioners that their use of economic stimulus funds and advancement of county surtax projects from fiscal years 2008 through 2011 translated to jobs for about 2,900 people.

“And I think it probably made a difference in (those people’s) lives,” Bullock said.

During the four years he cited, the county spent $82.4 million in stimulus money. The county’s non-stimulus spending totaled $226.2 million.

The stimulus funds resulted in about 770 jobs, with wages of about $26.3 million, according to a chart Bullock provided the commission. The non-stimulus job total was about 2,130, with wages of approximately $51.8 million.

“I think it’s worth noting … that the capital projects (involved) by and large backlogged facilities … that we knew that this county was going to have to construct within the next few years anyway,” said Commissioner Jon Thaxton.